SOLUTION: Use the approximate doubling time formula (rule of 70) for the case described below. Discuss whether the formula is valid for the case described:
An economic indicator is in
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An economic indicator is in
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Question 437539: Use the approximate doubling time formula (rule of 70) for the case described below. Discuss whether the formula is valid for the case described:
An economic indicator is increasing at the rate of 7% per year. What is the doubling time? By what factor will the indicator increase in 3 years?
Thank you. Answer by stanbon(75887) (Show Source):
You can put this solution on YOUR website! An economic indicator is increasing at the rate of 7% per year. What is the doubling time? By what factor will the indicator increase in 3 years?
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A(t) = P(1+(r/n))^(nt)
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2P = P(1+ (0.07))^t
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(1.07)^t = 2
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t = log(2)/log(1.07)
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t = 10.245 years
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By what factor will the indicator increase in 3 years?
Not sure what is meant by that.
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Cheers,
Stan H.
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